<< I had a stock do a reverse split leaving me with 166 out of 2500 shares. Does this count as a capital loss since those shares have been lost and I have lost money? DO i need to sell the 166 shares of the split stock before I can claim the capital loss.? >>Nope. No tax event on the reverse split, other than you now spread your total tax basis over fewer number of shares. But you receive no taxable loss, capital or otherwise, on the reverse split. If the securities have NO value, and can't be sold to anybody at any price, you may have worthless secutities...which is a different animal. Read more about worthless securities in the Taxes Frequently Asked Questions area (go to the Fools School and follow the roadmap). In order to secure a loss on the shares, they must be sold. Not necessarily all of them, but certainly some of the shares must be sold in order to generate any type of tax loss. A simple decline in value of the shares is not a taxable event, and will not yeild you a tax loss.TMF TaxesRoy
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